After determining how much you can afford and what type of neighborhood you would like to live in, a Todd Sandler Realtors agent can help you to find a property that will best suit your living needs. A Todd Sandler Realtors agent can help you to determine the characteristics of a home that are important to you, and how to rate the individual homes you are considering. While it's true that all homes share similar attributes: walls, floors, doors, etc., the same can be said about people: arms, legs, feet, etc. But like people, each home can have a distinctly different personality, and different qualities to offer. When you begin the process of finding the structure that you will call home, you should have a plan for evaluating (or should we say interviewing?) your prospective new residence. You must remember that you can spruce-up a building with a little paint and elbow-grease. But the features of a home that cannot easily be changed need special consideration in advance.
Understanding Appraisals & Market Values
Once you have narrowed down your choices of homes you are attracted to, you should then get an appraisal of the market value of the homes. A "Market Appraisal" differs greatly from a "Tax Assessment". Tax Assessments are set by appraisers who represent the city or town where the property is located, for the purpose of setting a value to base the property owner's local tax bill. The town appraisal will often only account for the most basic specifications of the home, such as lot size, square footage, number of bedrooms, etc. Tax Assessments often ignore any special features the home may have. As a result, most town appraisals are substantially less than the actual value of the home; thus, any arguments about the town appraisal are avoided.
A "Market Appraisal" accounts for all of the special features the home, the condition of the home, and the current state of the real estate market, and other factors. This more comprehensive appraisal offers an educated conclusion regarding the actual market value of the house, or the monetary amount that the house is worth. It is important to get a Market Appraisal of the house to know whether you are paying the appropriate price. An appraisal can be done one of two ways: through a complete appraisal or by having an "eyeball" appraisal done.
A complete appraisal involves a professional appraiser and can take some time. The appraiser needs to look up public records of similar houses that were recently sold, do a thorough examination of the house itself, and evaluate the economic condition of the community. This whole process might delay the closing of a house, but it is often ordered by the lending institution anyway. If the lending institution does the appraisal, you may want to consider getting a Market Appraisal of your own to confirm the other appraisal.
An option to a professional appraisal is to have an "eyeball" appraisal done. This type of appraisal is not as thorough as a complete appraisal but it is better than no appraisal at all. An eyeball appraisal is also an inexpensive way to verify the lending institution's valuation of the property. This type of appraisal calls for the expertise of an experienced professional who can look-over of the house and make determinations that would be close to that of an actual appraiser. Todd Sandler Realtors has experienced professionals who are familiar with this process and can help you to with an Eyeball Appraisal that can determine if the house purchase you are considering falls within the right price range.
Once the Eyeball Appraisal has been completed, you will want to answer the following questions:
- What price is the seller asking for the house?
- How does the price compare to similar homes on the market?
- What was the amount of the "eyeball" appraisal?
- How does this compare to the lender ordered appraisal?
- Are these prices consistent with courthouse records?
You should log these answers to make sure that neither the seller nor the lender are overstating the value. By doing your research, you are protecting yourself against being taken advantage of. It is obvious why a seller would ask for more than the appraised value of the house: more profit for them. The lending institution may also overstate the value to get you to take out a higher mortgage than necessary for the same reason. Many people simply love their home and hold it in high regard, with a high price to match. Keep in mind, however, that in a tight market or in a very desirable neighborhood a seller can ask for, and get, a selling price that is higher than the appraised Market Value of the property.
Any of the above examples represent great reasons to get a professional appraisal. You can never be too careful. Your home will most likely represent the largest investment of your life and your most important piece of equity. It makes sense to spend a little extra to make sure you paid the right price.
Understanding Home Inspections
Once a new home has been picked out, one very important step in the buying process is the home inspection. This differs from the appraisal in that it tells you the "physical condition" of the house and what items may need your attention in the near or distant future.
If you believe that you should have a mechanic check out a car before you purchase it, you should believe in having an inspector look at your house. You should get a professional inspector to conduct the inspection. Todd Sandler Realtors can provide you general information on finding a qualified professional inspector who can provide this service for you. However, as agents of the seller, we cannot directly recommend specific inspectors.
It will not be very cost-effective to pay money for an inspection on every house that you look at. It would be smarter to develop the ability to perform your own pre-inspections before you hire a professional to do one for you. While your pre-inspection probably won't be as comprehensive as a professional inspection, it will provide you with a good indication of the general condition of the home.
It is important to note that the purpose of a home inspection is to determine whether the property has any conditions that you could not have discovered on your own while viewing the house. Home inspections are NOT a tool for renegotiating the price of a property after you have chosen to buy it.
Todd Sandler Realtors strongly recommends that you get an inspection on the house you are considering to purchase. It is definitely the best way to protect everyone in the transaction. When securing a report, we recommend that you choose a qualified, professional, exprienced inspector who will stand behind his report. The inspector should belong to ASHI (The American Society of Home Inspectors) and the Inspection Company should carry the appropriate errors and ommissions insurance.
Lastly, you should have the home inspector separate any major problems from the minor problems in the inspection report. Remember, inspectors are NOT contractors and therefore should not quote prices for repair of specific items.